New survey indicates sharp drop in Social Media and Mobile Money usage in Uganda

Yesterday, results of a survey that was carried out to evaluate the impact of the recent taxes on OTTs (social media) and mobile money were released. However, they indicate a sharp drop in the number of users - as well as the frequency of usage - for both services.

According to the findings [PDF] of the survey which took place between July 13th and 16th, at least 85% of the respondents hadn't used social media since the tax came into effect.

"96% of respondents had used social media in the past 6 months," the report pointed out. However, noting that "this number [had] dropped to 85% when asked if they had accessed social media since July 1st [when the taxes were put into effect]."

Similarly, Mobile Money usage suffered a decline according to the survey. "93% of

respondents reported that they had used Mobile Money in the last 6 months," it said. But "44% were transacting less money in July and 47% reported that they had completely stopped transacting Mobile Money after the implementation of the new tax"

The survey was carried out by PR Company, Whitehead Communications, and collected information from 3015 respondents. "Results were collected both online and through face-to-face interviews across the country, gathering 3,015 responses," said the report.

Most of the participants in the survey were located in the central region. "72% were resided in Central Uganda, 15% in Western Uganda, 8% in Northern Uganda and 5% in Eastern Uganda, with 93 districts represented overall," the report noted.

Additionally, the majority were youths between 18 to 35 years of age and at least at a bachelors degree level of education.

Related: Here’s what ICTAU and PSFU proposed to parliament before OTT  tax came into effect

"Most surveyed respondents were between the ages of 18 and 35 (29% 18 – 24, 41% 25 – 30,15% 31 – 35). 74% of respondents were male and 26% were female. Most respondents were highly educated: 56% had obtained a Bachelor’s Degree, 14% a Master’s or Ph.D, 9% had Vocational Certificate, 15% completed Secondary School, 3% other, 2% had no education and 1% completed only Primary School."

According to the findings, a sizeable number is accessing social media using VPN application. While an equally impressive number is paying the tax to access the same services.

"Of those who reported as using social media since the new tax was introduced: 40% said they paid the OTT tax; 57% were using VPN; 38% were using WiFi/Hotspot(s) and 3% selected “other”; many used multiple methods."

Other noteworthy findings of the survey are the impact the taxes have so far had on the businesses and lives of the respondents.

For example, the mobile money tax has led to "delayed payments, general inconvenience, increased cost of doing business, increased risk, loss of income, reverting to banking and cash payments" as some noted in their responses.

While those using social media for business or as individuals pointed out that it had led to "delays in conducting business, disrupted payments, general inconvenience, increase in the cost of doing business, loss of income, reduced access and a smaller online audience."

The essence of the survey, according to Whitehead Communications, was to serve as a "resource in a consultative and evidence-based review of social media and mobile money taxes."

Therefore, the recommendation was that "the relevant decision-makers review the detailed results of this survey in full, particularly respondents’ written replies to the questions."

Additionally, they also recommended that a "thorough consultation among all parties going forward to ensure an informed and equitable solution." This is because no respondent was in support of the mobile money tax. While only 1% supported the social media tax strongly.

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